Policy Two funding for new buildings at integrated schools

Information about Policy Two funding which can be applied towards the costs of building either new classrooms in an existing integrated school, or a new integrated school.

Level of compliance Main audience Other


  • Boards
  • Proprietors
  • Principals and Tumuaki
  • Administrators

The proprietor of an integrated school has responsibility for providing accommodation at the school, and therefore the funding support is not an automatic entitlement. Proprietors applying for funding must ensure their projects meet criteria.

About Policy Two funding 

The proprietor of an integrated school is responsible for providing accommodation at the school. This is because it's their decision to:

  • establish a school and apply for it to be integrated
  • increase the capacity of the school by applying for a maximum roll increase.

However the Ministry of Education may sometimes help with the costs of building new accommodation when:

  • the school meets certain criteria
  • we would otherwise have to build state school facilities.

Receiving Policy Two funding

Policy Two funding is not an automatic entitlement.

If an application is approved, we pay out the funding when we receive an invoice and signed deed of covenant from the proprietor. The funding may be paid out over several financial years.

Applying for Policy Two funding 

To discuss applications for Policy Two funding, please contact your regional Ministry advisor.

We approve applications in 2 steps.

  1. We give approval in principle based on the assessment criteria and seek funding from Government through the annual budget process.
  2. We allocate the funding based on the amount of funding we get from Government.

The assessment criteria for classroom-only assistance are:

  • the application defines the local school network (using the boundaries set out in the area report)
  • current demand for enrolment in that network is over 85% of its capacity
  • projected demand will go beyond the network’s current capacity within 10 years.

For Policy Two funding to establish an entire new school, the 3 criteria above must be met, and a fourth criteria being a new state school is likely to be needed within 10 years if the integrated school isn't built.

Funding rates

The level of funding we provide depends on the type of assistance.

Classroom-only assistance: Funding is for the cost of classrooms needed to meet the demand. This is regardless of whether the proprietor is building a school or expanding an existing school.

Whole school assistance: Funding is based on the cost of building a new state school. It includes construction costs of teaching and non-teaching spaces up to the School Property Guide (SPG) entitlement.

Visit our integrated schools page for more information about SPG and how much property will be integrated.

Integrating schools into the state system

We provide 85% of the funding provided for classrooms in state non-integrated schools. This is regardless of whether the proprietor is building a new school or expanding an existing school. The standard classroom budget is reviewed annually.

Ownership of the buildings

For accommodation built with Policy Two funding, we can opt:

  • for the proprietor to own it, or
  • to own it ourselves.

Arrangements with the Ministry as owner

If we opt to own the accommodation we lease it back to the proprietor. The ground lease will be:

  • for a 35 year term
  • at a peppercorn rental (that is, a nominal payment).

The proprietor is responsible for insuring the assets as they'll get the beneficial use of them.

We consider a lease to be more practical for new schools where significant investments are expected. For one-off classrooms, it's more likely that the proprietor will be the owner, given the complications involved in creating a ground lease for a small amount of property.

Using board funding for new accommodation

The board at an integrated school can provide funding to build new property with the approval of both the Ministry and proprietor. However, such property isn't eligible for:

  • integration; or
  • maintenance funding from the Ministry.

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